India's industry body ASSOCHAM welcomed recent Reserve Bank of India (RBI) and Finance Ministry measures to address rupee volatility and FPI flow swings, and called for further tax rationalisation and simpler rules to attract stable long-term foreign capital. It praised the Income-tax Amendment Ordinance, 2026, which exempts FPI investments in government securities from tax on interest and capital gains from April 1, 2026. ASSOCHAM also urged considering an SBI Research proposal to extend the long-term equity holding definition to two-three years, with incentives for such investments. It noted the rupee had recovered nearly 2% from recent lows, and blamed global factors such as high US bond yields, elevated crude prices and a shift of capital toward AI and technology for FPI volatility.
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- ASSOCHAM calls for tax simplification , long - term holding incentives to strengthen capital flows
ASSOCHAM called for further tax rationalisation and simpler tax rules to attract stable, long-term foreign investment, welcoming recent RBI and Finance Ministry steps to bolster investor confidence amid rupee volatility and FPI flow swings. It welcomed the Income-tax Amendment Ordinance, 2026, which exempts FPI investments in government securities from tax on interest and capital gains from April 1, 2026, and Finance Minister Nirmala Sitharaman's remarks that the government wants investor views on long-term capital gains tax and securities transaction tax ahead of the 2027-28 Union Budget. The group cited RBI measures that helped the rupee recover nearly 2% from recent lows, and suggested considering SBI Research's proposal to extend long-term equity holdings to two to three years with incentives. It said global factors such as high US bond yields, elevated crude prices and capital shifting toward AI had driven FPI volatility.
- ASSOCHAM calls for tax simplification , long - term holding incentives to strengthen capital flows
ASSOCHAM has urged further tax rationalisation and simpler, standardised tax rules to attract stable, long-term foreign investment into India. It welcomed recent RBI and government measures to stabilise the rupee and the Income-tax Amendment Ordinance, 2026, which exempts FPI investment in government securities from tax on interest and capital gains from April 1, 2026. The body also backed the government's consultation on long-term capital gains tax and securities transaction tax ahead of the Union Budget 2027-28, and proposed extending the definition of long-term equity holdings to two-three years with incentives. ASSOCHAM cited the rupee's recovery of nearly 2 per cent from recent lows and a 7.1 per cent GDP growth projection for FY27, while noting that high US bond yields, elevated crude prices and a shift towards AI-related investments had driven volatility in FPI flows.
- ASSOCHAM calls for tax simplification , long - term holding incentives to strengthen capital flows
Industry body ASSOCHAM called for further tax rationalisation and simpler tax rules to attract stable, long-term foreign investment, welcoming recent RBI and Finance Ministry measures to bolster investor confidence amid rupee volatility and FPI flows. It welcomed the Income-tax Amendment Ordinance, 2026, which exempts FPI investments in government securities from tax on interest and capital gains from April 1, 2026. ASSOCHAM also backed considering SBI Research's proposal to extend long-term equity holding definitions to two-three years with incentives, and welcomed Finance Minister Nirmala Sitharaman's remarks that the government wants investor views on LTCG and STT ahead of the Union Budget 2027-28. The group said RBI measures helped the rupee recover nearly 2 per cent from recent lows, and pointed to foreign exchange reserves and the RBI's 7.1 per cent GDP growth projection for FY27 as signs of economic strength.
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